Former Fabric CFO Nevin Shetty was sentenced to two years in federal prison on March 5, 2026, after a jury convicted him of four counts of wire fraud for transferring $35,000,100 of the company’s money to a business he controlled and placing it in high-yield decentralized-finance lending. The court also ordered him to pay $35,000,100, serve three years of supervised release, and obtain probation-office permission before serving as a company officer or director.
What happened to Fabric’s money?
Shetty joined Fabric, a private software company, as chief financial officer in March 2021. According to the U.S. Attorney’s Office for the Western District of Washington, Fabric’s investment policy called for cash to remain in money-market accounts or other conservative investments so the company could preserve capital for operations and growth. Shetty helped draft and circulate that policy for board approval.
Prosecutors said Shetty created HighTower Treasury in early 2022 as a side business with no other outside customers. Between April 1 and April 12, 2022, he ordered transfers totaling $35,000,100 from Fabric’s account to an account for HighTower. The Justice Department said no other executives or board members knew about the transfers.
How was the money invested?
Through HighTower, Shetty placed the money in decentralized-finance (DeFi) lending protocols that advertised returns of 20% or more, according to the DOJ. The strategy was to pay Fabric a comparatively small fixed amount while HighTower kept the remaining returns. Prosecutors said the arrangement generated roughly $133,000 in profit for Shetty and his business partner during the first month.
What’s actually slowing this PC down?
Pick the symptom - the matching free tool is one click away.
The contrast was stark: the company policy described by prosecutors favored conservative investments intended to preserve operating cash, while the actual strategy exposed that cash to high-yield DeFi lending. By May 13, 2022, the investments were nearly worthless. After the funds were essentially gone, Shetty told two fellow executives and was fired, the DOJ said.
What did the jury find, and what did the court order?
After a nine-day trial, a jury found Shetty guilty of four wire-fraud counts on November 7, 2025. The DOJ’s sentencing announcement describes the prosecution’s account of the scheme and the sentence; it is not a complete account of every trial argument or court filing.
On March 5, 2026, U.S. District Judge Tana Lin sentenced Shetty to two years in prison. The court also ordered:
- Payment of $35,000,100.
- Three years of supervised release.
- No service as a company officer or director without prior permission from the probation office.
The DOJ release attributes this statement to Judge Lin at sentencing: “You were playing with money that wasn’t yours.” It also quotes Assistant U.S. Attorney Philip Kopczynski describing the scheme as “a calculated scheme motivated by greed and meticulously carried out over many months.” Those are the speakers’ characterizations, not separate jury findings.
What was the reported impact on Fabric?
The DOJ said Fabric had to lay off 60 employees while adapting to the loss. That figure is the impact reported in the sentencing release; the sources cited here do not provide a fuller breakdown of the company’s finances or subsequent recovery.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Why the CFO role mattered
In the DOJ release, Jonathan Dean, assistant special agent in charge of the FBI Seattle field office, said: “As the company’s CFO, Mr. Shetty was not only part of the investment planning but also had the access and trust to move the money.” The case illustrates the difference between an investment policy on paper and the authority and oversight that govern actual transfers; the DOJ account establishes the policy and unauthorized transfers but does not assess particular financial-control products or prescribe a control framework.
Quick Recap
Sources and case timeline
- U.S. Attorney’s Office for the Western District of Washington, sentencing announcement, March 5, 2026.
- GeekWire sentencing coverage by Kurt Schlosser, March 5, 2026.
- GeekWire conviction coverage by Kurt Schlosser, November 13, 2025.
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
